Olympic 'bounce' seen boosting UK

Friday, August 17, 2012 - 02:23

Aug.16 - The end of the 2012 Olympics has left economists more uncertain than ever about the Games' boost to Britain's economy, although most agree they will help thrust the country out of recession, according to a Reuters poll. Hayley Platt reports.

▲ Hide Transcript

▶ View Transcript

There's little doubt that the London Olympics were a huge technical and political success.
But it's not yet fully known if they were a financial one to.
Reuters polling unit spoke to more than 60 economists to hear their views.
Ross Finley is the editor of Reuters polls and economic data.
SOUNDBITE: Ross Finley, Editor, Reuters Polls & Economic Data, Reuters, saying, (English):
"I think everybody is pretty much saying there will be some kind of a boost from the Olympic games. It would be crazy if there weren't a boost. What they weren't sure how big that would be. Britain's in a recession so clearly the Q3 numbers are going to haul the economy out of recession."
Britain's bruised economy has been shrinking since 2011, stifled by the euro zone debt crisis and harsh austerity measures at home.
And although the majority of economists polled believe Britain will exit recession in the next quarter - they don't all agree on the reason why or how long it will last.
Jonathan Ashworth from Morgan Stanley is unconvinced.
SOUNDBITE: Jonathan Ashworth, Economist, Morgan Stanley, saying (English):
"I think beneath the surface the underlying state of the British economy is still likely to remain quite weak in the third and fourth quarters of the year so the Olympics in itself won't be a catalyst to a significant improvement in the UK economy going forward. The main element typically is what happens in Europe."
The latest data from Eurostat showed the euro zone is in danger of sliding into recession.
Its economy shrunk by 0.2 percent in the second quarter, as the ongoing debt crisis kept shoppers at bay.
SOUNDBITE: Jonathan Ashworth, Economist, Morgan Stanley, saying (English):
"You can never rule out a triple-dip recession but more importantly as we move into the second half of 2013 we think a modest pickup in the European economy and continued falls in inflation should provide a boost to real incomes of consumers, so we do think you'll get something of a gradual pick up in the UK economy as we move through 2013."
While the Olympics were hailed a huge success for Britain, evidence of its economic impact remains sketchy.
Hayley Platt, Reuters.

University of York scientists say 850 million tonnes of carbon dioxide could be mineralised each year by combining sea water, graphite, solar-powered electricity, and scrap metal in a purpose-built reactor

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV. Learn more about Thomson Reuters products: